I go into these numbers because it’s so important to have some reality in this conversation. Everybody talks about the billions, and they’re important. But we rarely write and talk about how we actually pay taxes. I submit that doing so illustrates the key substantive points on Obama’s side. First, in moral terms, the current rate structure is grossly inequitable. But second and more important, this is about stimulating the economy. The middle-income woman is almost certainly going to take her tax savings and spend it. She probably doesn’t have the luxury of saving or investing it. The $350,000 earner? Well, maybe he’ll spend it on a more tricked-out and suped-up Lexus. Or maybe he won’t. The $1 million earner? He’ll almost certainly sock away most of that $50,000, unless this happens to be yacht year.
That’s the substantive case. Extending the tax cuts for the working and middle classes will help stimulate the economy. And this is about the only stimulus we’re likely to get, as we know. As for the upper incomes, the GOP line that this will crush small businesses, trotted out tiresomely by the Romney campaign, is blather. The vast majority of small-business owners don’t have incomes like that and will not be affected by Obama’s proposal.